The Responsible Home Ownership program is operated the non-profit Community Housing and Development Corp. The Responsible Home Ownership program offers down payment assistance specifically to low-income individuals who have steady income and good credit. Home buyers may qualify for this program if;
They meet low-income criteria.
They are pre-qualified for an FHA home loan, or are approved for an FHA loan.
They want to buy a home in the United States.
The seller participates in the program.
To participate, a seller must sign the "Participating Home Agreement". Check with your loan officer and/or realtor to learn how to get your seller into the program if not currently involved. Funds from this program can be used for both closing costs and down payments.
Responsible Home down payment assistance program is different than other programs because it is not limited to owner-occupied single family residences. This program allows down payment assistance for multi-family homes or commercial purchases. (Some of the terms of this down payment assistance program may fall outside the bounds of what you are permitted to buy with an FHA loan.)
Check with your loan officer if you have specific questions about your participation in this program using an FHA-approved home loan. Down payment assistance programs require the seller to pay a fee to participate. The fee is considered a payment for services rendered and not a tax-deductible charitable contribution.
Elimination of Non-profit Down Payment Assistance
On July 30, 2008, President Bush signed H.R. 3221 - Housing and Economic Recovery Act of 2008.
Section 2113 of the bill prohibits seller-funded DPA (Down Payment Assistance) for loans backed by
the Federal Housing Administration. Prior to this bill, the seller could contribute up to 6% to the buyer to
cover either a down payment or closing costs on an FHA loan. The changes became effective October 1, 2008.
Since this program is no longer available, we recommend that you get pre-approved for a low down payment FHA home loan.
Q: What happens if interest rates decrease and I have a fixed rate loan?
A: If interest rates drop significantly, you may want to investigate refinancing. Most experts agree that if you plan to be in your house for at least 18 months and you can get a rate 2% less than your current one, refinancing is smart. Refinancing may, however, involve paying many of the same fees paid at the original closing, plus origination and application fees.